[[Home|🏠]] <span style="color: LightSlateGray">></span> [[Interviews]] <span style="color: LightSlateGray">></span> August 25 2024 **Insider**: [[Peter Beck]] **Source**: [Sharesies](https://www.youtube.com/watch?v=9bWGpX6r3Hc) **Date**: August 25 2024  🔗 Backup Link: https://www.youtube.com/watch?v=9bWGpX6r3Hc ## 🎙️ Transcript >[!hint] Transcript may contain errors or inaccuracies. ### What Made You Pick Space? **Sir Peter Beck:** The reason I like space is that you can have maximum impact on this planet for minimum resources and effort. Think about this: you can put a spacecraft in orbit—take an example of a weather spacecraft we put in orbit a few years ago—and that weather spacecraft can provide data, services, and knowledge to literally hundreds of millions of people every day, times the duration of the spacecraft's lifetime, which could be 10 years. So this crazy little box of electronics can have just a huge amount of impact to so many people. There are very few industries where you can have that amount of impact or have that amount of reach. That's primarily the thing I love about space. Plus, it's cool. ### Are You Contributing to Space Junk and Is There a Plan to Clean It Up? **Sir Peter Beck:** I think anybody who launches anything to space has to put their hand on their heart and say, "Yeah, well, sometimes we leave some stuff behind." We've always taken the approach that we want to leave the minimum amount behind as we possibly can. The way that Electron goes to orbit is quite different to most rockets. You'll notice that there's a little bit on the top called a kick stage, and we try and de-orbit that wherever possible and just leave behind only the customer spacecraft. That's not the normal thing—a lot of countries will just leave the whole spent upper stage of the rocket in orbit, which is pretty nasty. I think there's a common misperception that space junk is just dead satellites. Actually, it's like 1/3 dead rockets and 2/3 dead satellites, or thereabouts. We certainly do everything we can to make sure we have the minimum impact possible. I would say as far as companies go or businesses go, we're probably the furthest leaning forward on advocating for some kind of regulation. Generally, as an entrepreneur, you don't want any regulation, but this is an instance where we think that some traffic management is going to be critical, and we certainly advocate for that internationally. **Interviewer:** There definitely seems to be an exponential curve with regards to how much is going up, isn't it? When you say de-orbit, you have some additional propulsion or something? **Sir Peter Beck:** Correct. That kick stage has a little rocket engine on it, and we circularize the orbit, deploy the spacecraft, and wherever possible, we'll burn that engine again and put it into a declining orbit. ### Macro Factors **Interviewer:** What are the macro factors that impact the space industry and therefore Rocket Lab? **Sir Peter Beck:** From a share price standpoint, there are plenty of macro factors that influence that, that we have no control over. But generally, the space industry seems pretty insulated from a lot of these things just because of the duration of the programs typically. **Interviewer:** Do you have any sensitivities to or much sensitivity to the interest rate environment? **Sir Peter Beck:** Absolutely. With the share price, we can have a flawless launch, and the share price goes down simply because of a macro environment kind of thing. ### Favorite Space Movie **Interviewer:** Favorite space movie? **Sir Peter Beck:** 2001: A Space Odyssey. As you walked into the facility, hopefully if you watched that movie enough times, you'll recognize the entrance portal is actually very similar to the portal of the HAL computer. **Interviewer:** What's the most accurate space movie? **Sir Peter Beck:** Actually, 2001: A Space Odyssey is very accurate. It's one of the few space movies that doesn't have sound in space. You see a lot of those movies, and the cruiser will ignite its engine, you hear this roar, and it's like, "No." It's falling over quite a fundamental hurdle. ### Rocket Lab Growth **Interviewer:** What steps are you taking to improve the growth of Rocket Lab at the moment? **Sir Peter Beck:** You can see the growth rate to date—70-odd percent. We're always looking at new opportunities, and we're investing heavily into projects and products like Neutron. Neutron is going to be a huge needle mover. If you look at the combination of the space systems and the launch business, and opening up that $320 billion total addressable market, we're moving pretty aggressively towards that. ### New Launch Site **Interviewer:** Has Rocket Lab considered adding another launch site in New Zealand or Australia? **Sir Peter Beck:** No. Generally, I avoid launch sites. They are giant cost centers. It costs a lot of money to operate a launch site, to staff it, to keep it running. So I want the minimum amount of launch sites possible to achieve our launch manifest because they are P&L burners. We don't want more of those. ### Competitive Advantages **Interviewer:** What are the competitive advantages in operating out of New Zealand, and what are the challenges? **Sir Peter Beck:** Great question. The reason why we have operations in New Zealand is primarily because of that launch site. All the launch sites in the United States are pretty much flat out, and we made a strategic decision to not have to line up behind the big players in the industry and wait our turn. It wasn't an easy decision because there had to be a Technology Safeguard Agreement signed between the two countries, a bilateral treaty had to be created between New Zealand and the US, a whole lot of rules and regulations had to be created and amended, a space agency was created. So it wasn't an easy thing to do. But we realize it now because we are the third most frequently launched rocket in the world. What we're able to do is poke our head outside the hangar and go, "Ah, today's a good day for launch, we're go and launch today." Moreover, it meets our business model where customers move around on us. If you're lined up at the Cape and you miss your window, you've got to wait a month to get your next window. Whereas if we want to move a couple of days down at Mahia, no big deal, we'll just move a couple of days. **Interviewer:** Are any other companies using the Mahia launch site, or is it just you? **Sir Peter Beck:** We operate the only private orbital launch site in the world. ### Tasty or Edam Cheese? **Interviewer:** Tasty or Edam cheese? **Sir Peter Beck:** Tasty, every day. ### Engineering R&D After Neutron **Interviewer:** Once Neutron R&D is complete and the rocket is operational, do you anticipate that you'll need to reduce your engineering R&D headcount to become cash flow positive, or will the staff be able to be reassigned to further Space Systems development while still maintaining healthy profit? **Sir Peter Beck:** That's a great question. If we were just going to stop at Neutron, maybe, but we're not. You've seen our growth agenda here. Neutron is one important piece of a puzzle to get to an end-to-end Space Systems company and really move into those products and services and delivering infrastructure in orbit. The same question could have been asked of Electron, but the one thing I will say is that the one thing that has always been a throttle on this business is talent. We can never pipe enough people, enough engineers into this business to continue on the growth trajectory that we want. So I never see that being a challenge. I think Neutron is a very transformational product line in its own right, and the amount of engineers that you have to deliver that product isn't as many as you think. Those engineers will be quickly redeployed into other growth opportunities. ### Facility Tour **Interviewer:** Where are we, Peter, and what have we got here? **Sir Peter Beck:** This is sort of part of the foyer, and this is actually a recovered upper stage of an Electron rocket. This is the very first rocket that we brought back down from space, and we cut it up and stuck it in the foyer. If you ever want to touch something that's been to space and back, now's a chance. **Interviewer:** Where did you find it? **Sir Peter Beck:** We fished this out of the ocean. This was on the "Return to Sender" mission, flight 16. It separated in its normal trajectory and then followed a ballistic arc, re-entered the Earth's atmosphere, then landed in the ocean, and we picked it back up. **Interviewer:** One of the coolest receptions—well, certainly the coolest reception I've ever been into. We heard a story about the idea of this when you walk into Rocket Lab. Can you tell us a little bit about the thinking into the space? **Sir Peter Beck:** As you enter the portal behind you there, it should look a little bit like 2001: A Space Odyssey. You want to be transformed when you come in here into what the space business is actually like. This area is kind of a reception for sure, but also behind all those glass panes, that's mission control. It gives a great opportunity for staff with visitors to come here and actually experience a launch and watch mission control as it happens. **Interviewer:** What are the people in mission control up to on the day-to-day? There's no launches today, but we've got a bunch of people in there. What are they sort of up to? **Sir Peter Beck:** On a day-to-day basis, they're running either whole stage tests or stack tests, or launching. We also run some of our satellite missions out of there. We actually have five mission controls across all of our sites in the world, and at any one time, we're controlling spacecraft or launching rockets and various testing activities out of all of those mission controls. **Interviewer:** We've got what looks like the NASDAQ bell site. Can you tell us a little bit about why you chose NASDAQ as the place to list the company? **Sir Peter Beck:** From a high-growth tech company standpoint, the NASDAQ exchange just really suited us. It most accurately represents who we are as a company.